When it comes to businesses, nonprofits, and governments, Microsoft's business strategy is simple—create software and hardware that help those entities, and the people employed there, be more productive in a mobile-first, cloud-first work environment. The results of that strategy are self-evident and are reflected in Microsoft's financial reporting and the price of its stock.

However, the consumer division, with its emphasis on Windows 10 at home and the Xbox console, often comes across as an unintended appendage to the company's overall business strategy. But it would be a mistake to underestimate the consumer entertainment market. Video gaming and streaming are huge growing markets and very lucrative. And while the augmented and virtual reality markets are still in their nascent stages, the potential size of those markets is nearly incalculable.

So even though the business market is its bread and butter now, Microsoft knows that there are huge profits to be made from being the prominent entertainment system in our living rooms. And with Project Scorpio, Microsoft has just taken a major step toward that desired market dominance.

Project Scorpio

Project Scorpio is Microsoft's not-so-secret code name for its next version of the Xbox console. In April 2017, Microsoft released a technical preview of its new Xbox via the Digital Foundry. The technical specifications are impressive and should make any gamer sit up and take notice:

Digital Foundry

To put the impact of those technical specifications into perspective, Microsoft says its next Xbox will deliver 6 teraflops of graphic throughput, which will allow consumers to experience games in true 4K. So for those of you wondering why you bought a 4K television in the first place, now you at least have access to some content designed to take advantage of those ultrahigh resolutions.

Semiconductor chipmaker AMD will manufacture the internal hardware for Project Scorpio using a proprietary design for both the CPU and the GPU. This is another coup for AMD and will help keep the company relevant in comparison to its primary competitors at Intel and NVIDIA.

Bottom line

Image: Andy Trotman/Microsoft News

It is important to note that Project Scorpio is not creating the next generation console—the next Xbox is certainly a major improvement in hardware, but it is still x86-based and backward compatible with most previously released Xbox games. We are talking evolution, not revolution.

However, for Microsoft, the success of Project Scorpio does not rely on the power of the new hardware. The key to success is dependent on how many game developers embrace the computational power of the next version of the Xbox. As impressive as the technical specifications may be, it won't matter if developers don't create games with Project Scorpio in mind.

As a gamer, I would like Project Scorpio to be a great success because it would help increase the overall gaming market and raise the level of competition. Increased competition means better games, better hardware, and more choices for consumers—all of which greatly benefits my chosen hobby.

According to the Project Scorpio website, the next version of the Microsoft Xbox is scheduled for release in late 2017—just in time for the holidays. Of course, in game development terms, that might as well be next month. Which means that developers should have been writing code that takes advantage of all this new fancy hardware for at least a year now. Certainly, that is the case, right?

For its sake, Microsoft better hope that is a correct assumption or Project Scorpio will go down as just another technical marvel that eventually ended up a financial flop. Not a good outcome for Microsoft nor for video gaming in general.

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About Mark Kaelin

Mark W. Kaelin has been writing and editing stories about the IT industry, gadgets, finance, accounting, and tech-life for more than 25 years. Most recently, he has been a regular contributor to BreakingModern.com, aNewDomain.net, and TechRepublic.

Full Bio

Mark W. Kaelin has been writing and editing stories about the IT industry, gadgets, finance, accounting, and tech-life for more than 25 years. Most recently, he has been a regular contributor to BreakingModern.com, aNewDomain.net, and TechRepublic.